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The Indian economy was facing grave uncertainty. Growth had started decelerating when the interim and full budget for 2009-10 were presented. 

 

At home there was added uncertainty because of subnormal southwest monsoon. Yet, the economy now in a far better position than it was eight years ago. India weathered the economic crisis well and emerged from the global slowdown faster than any other country. 

  

First challenge before the government is to quickly revert to high GDP growth path of 9%. Expects 10% economic growth in the near future. Second challenge is to harness economic growth to make it more inclusive and consolidate gains. Third challenge is to overcome weakness in government's public delivery mechanism; a long way to go in this. 

  

Impressive recovery in the past few months. Can witness faster recovery in the coming months. Food security has been strengthened. But bottleneck of the public delivery mechanism can hold us back. Fiscal year 2009-10 was challenging for the economy. Focus shifted to non-governmental actors and an enabling government. Government now concentrates on supporting and delivering services to the poorer sections. 

 

Economy stabilised in the first quarter of 2009 itself. 18.5% manufacturing growth in December was the highest in two decades. Figures for merchandise exports for January encouraging after turnaround in November and December last year. 

          

Double digit food inflation last year due to bad monsoon and drought-like conditions. Government conscious of the price rise and taking steps to tackle it. Erratic monsoon and drought-like conditions forced supply-side bottleneck that fuelled inflation. Need to review stimulus imparted to economy last year to overcome the recession. Need to ensure that the demand-supply imbalance is managed. Need to make growth more broad-based. Need to review public spending and mobilise resources. Status paper on public debt within six months. Government hopes to implement direct tax code from April 2011. Earnest endeavour to implement general sales tax in April 2011. Government will raise 25,000 crore from divestment of its stake in state-owned firms.

Kirit Parekh report on fuel price deregulation will be taken up by petroleum minister Murli Deora in due course. 

 

Nutrient-based fertiliser subsidy scheme to come into force from April 1 this year. Nutrient-based fertiliser subsidy will reduce volatility of subsidy and also reduce it. Market capitalisation of five public-sector undertakings listed since October increased by 3.5 times.

Non -banking finance companies will also be considered if they meet the criteria. handlooms and small and medium enterprises.500 crore to public-sector banks to maintain tier-I capital. 500 crore allocated for solar and hydro projects for the Ladakh region in Jammu & Kashmir.  Interest subvention for timely repayment of crop loans raised from 1% to 2%. bringing the effective rate of interest to 5%. accounting for 37% of the total plan allocation. Government committed to ensuring continued growth ofspecial economic zones Need to take firm view on opening up of the retail sector.73.      200 crore provided for climate-resilient agriculture initiative.894 crore.000 crore. Government to continue interest subvention of 2% for one more year for exports covering handicrafts. to be placed in the public domain soon.     1. Allocation for National Ganga River Basin Authority doubled to 500 crore. Intends to make FDI policy user friendly by compling all guidelines into one document.752 crore. an increase of 950 crore over the last financial year. Outlay for social sectors pegged at 1.130 crore in 2010-11. Government has taken series of steps to simplify FDI regime.674 crore. in view of the drought and floods in some parts of the country. carpets. IIFCL authorised to refinance infrastructure projects. Government proposes to set up Coal Development Regulatory Authority.37. Period for repayment of loans by farmers extended by six months to June 30. Clean Energy Fund to be created for research in new energy sources.   Government to provide 16.   Road transport allocation raised by 13% to 19. Allocation for new and renewable energy ministry increased by 61% to 1. FDI inflows steady during the year. allocation to power sector more than doubled to 5. Mega power plant policy modified to lower cost of generation. Proposal to maintain thrust of upgrading infrastructure in rural and urban areas.  Government to provide 300 crore to organise 60. RBI considering issuing banking licences to private companies.    Government has decided to set up apex-level Financial Stability and Development Council. One-time grant of 200 crore provided to Tirupur textile cluster in Tamil Nadu. Allocation for railways fixed at 16. . Deficit in foodgrains storage capacity to be met with private-sector participation.000 pulse and oilseed villages and provide integrated intervention of watershed and related programmes. Draft of Food Security Bill ready. 2010.          Government favours competitive bidding for coal blocks for captive power plants.552 crore provided for infrastructure development. Alternative port to be developed at Sagar Island in West Bengal.

19.        Plan allocation for school education raised from 26.740 crore to 2. 1.534 crore.344 crore in 2010-11 against 60.657 crore in budget 7.392 crore and plan expenditure at 7. . 31. Gross tax receipts pegged at Total expenditure pegged at Fiscal deficit at 5.100 crore have been allocated.656 crore for 2010-11. euro and Japanese yen. Proposed increase of 15% in plan expenditure and 6% in non-plan expenditure.400 crore in 2010-11. Fiscal deficit seen at 4. 1% interest subvention loan for houses costing up to provided. 2011.500 crore.46.  Defence allocation pegged at 1.800 crore to 25% of plan outlay earmarked for rural infrastructure development.     Cash subsidy for fuel and fertiliser instead of previous practice of bonds to continue.703 crore in the previous year.600 crore. Allocation for woman and child development increased by 80% Plan outlay for the social justice ministry raised by 80% to 4. 1. Government's net borrowing to be 3.45.270 crore provided for slum development programme. 1. capital expenditure would account for        Planning Commission to prepare integrated action plan for Naxal-affected areas to encourage "misguided elements" to eschew violence and join the mainstream. marking an increase of 700%. Allocation for National Rural Employment Guarantee Authority stepped up to 40.1% in 2011-12 and 2012±13. an increase of 8.8 lakh crore. British pound sterling. 66.47.8% and 4.6%. Non-plan expenditure pegged at 37.41.118 crore.500 in hilly areas. 1.35. Plan allocation for minority affairs ministry raised from 1. respectively.000 per annum to each account holder under the new pension scheme. Indira Awas Yojana's unit cost raised to 45.48.9% in 2009-10 as against 7.036 crore in 2010-11.000 crore to provide social         Government to contribute 1. 20 lakh extended to March 31. Exclusive skill development programme to be launched for textile and garment-sector employees. Allocation for urban development increased by 75% to 5.400 crore. non-tax revenues at 11.000 crore.100 crore in 2010-11. Of this.010 crore for 2010-11.5%.794 crore to 2. Fiscal deficit pegged at 6. 700 crore    Allocation for development of micro and small-scale sector raised from 1. estimates.000 in the plains and 48. A unique identity symbol will be provided to the rupee in line with the US dollar. Government to set up National Social Security Fund with initial allocation of security to workers in the unorganised sector. Financial-Sector Legislative Reforms Committee to be set up. Income-tax department ready with two-page Saral-2 returns form for individual salaried assesses. 1.300 crore from For rural development. Plan allocation for health and family welfare increased to 22.8% in the previous fiscal.900 crore allocated for Unique Identification Authority of India.

60 lakh and professionals earning up to 15 lakh to be exempted from     Housing projects allowed to be completed in five years instead of four to avail of tax breaks. on diesel and petrol to 7. Businesses with a turnover of up to the obligation to audit their accounts.5%. Customs and central excise proposals to result in a net revenue gain of More services to be brought under the service tax net. Clean energy cess of 50 per ton to be levied on coal produced in India.000 crore on direct tax proposals.000 allowed on long-term infrastructure bonds for income-tax payers. [edit] See also .6 lakh ² nil 1. and on other petroleum products to 10%. Weighted deduction of 125% for payments to approved associations doing social and statistical research. 43.     Investment-linked tax deductions to be allowed to two-star hotels anywhere in the country.6 lakh and up to 5 lakh and up to 8 lakh ² 30% 20. Certain accredited news agencies exempted from payment of service tax.500 crore. Personal income-ax rates pruned:      Income up to Income above Income above Income above 1. Central excise duty on all non-petroleum products raised to 10% from 8%. and cigarillos. cigars.         Structural changes in excise duties on cigarettes.500 crore. Concessional excise duty of 4% on solar cycle-rickshaws. Net revenue gain from tax proposals pegged at 20. this is 5 lakh ² 10% 8 lakh ² 20% Additional deduction of above 1 lakh on savings instruments allowed already. Revenue loss of 26. One-time interim relief to housing and real-estate sector. Balloons exempted from central excise duty. FM increases customs duty on crude oil to 5%.